Bloomberg TechBloomberg's Caroline Hyde breaks down the significance of Apple CEO Tim Cook's visit in China. Plus, a look at what's behind Tesla's post-election stock surge, and why Bitcoin's rally is stalling after nearly reaching $100,000.
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This is Bloomberg Technology with Caroline Hyde and Ed loved Love.
We are live from New York. This is Bloomberg Technology.
Coming up, Apple CEO Tim Cook visit China and undines its importance to.
The tech company.
Will discuss the future US China relations and supply chains. Plus we'll look at what's behind Tesla's post election stock surge.
Is it fundamentals, is it hype?
And Bitcoin's rally stools out after nearly reaching one hundred thousand dollars.
We'll discussed on Kristen Smith from Blockchain Association, but first.
Let's get a little bit more on today's market moves when you fold in the geopolitical contentions here, we're still on what happens between US and China, and we still tried to digest what's happened in terms of earnings from the Chinese tech johnts Isabelle Lee joins us now and Isabelle, you've really been going global for us, and I want to take a moment to say how awful Chinese earnings have been for the big tech companies, and we get a little bit of a reprieven training today, but we were entering a bear market at the end.
Of last week.
Definitely, it was definitely underwhelming for all of the Chinese tech companies, and it's not a surprise to allude to the geopolitical and economic uncertainties and whether or not these companies can win investors back large hinges on Beijing's stimulus splits and that has really since fizzled out. Just over the past week, we have the five biggest tech companies erase forty one billion dollars in market cap. The MSCAI China indexed slits its lowest in September, and call after call, a lot of these executives are really just saying how uneven the economy is and how underwhelming their business is, and how most offered cautious optimism. But they also ask investors for patients. We have PDD for example, they walk around discussing their disappointing earnings. Ten Cent that it promised new blockbusters, even Baidu, which is the front runner in the AI development, failed to wow. And adding to this is of course Donald Trump win and what that would mean for China. And lastly we have Morgan Stanley cutting Chinese equities too slight underweight and Golden sax lowing. It's MSCA Chinese gauge ratings, so it's really underscores how cautious and how shaky Chinese equities are on for.
Now, it's really with the roundup of concerns with China. Meanwhile, I commit that economic concern or a number of top executives of global firms traveling to China participating in discussions with the country's premiere. Apple CEO, Tim Cook was one of the most notable names. Just to take a listen to what he's had to say.
And I'm thrilled to be here and I'm so proud that Apple has an exhibit here with our partners.
So how do you value your partners in China?
Oh, I value them very highly. We could not do what we do without them.
Dan Willman's with us joining us for more on will remind us why China is so integral to Apple.
China is a huge, hugely important to Apple supply chain, and according to our reporting, it is Apple's second largest market behind the US, where it is currently struggling. According to many of our reports over this past year against domestic Chinese domestics smartphone makers. So on those two counts extremely important to Apple.
Meanwhile, they've got to try and front run what other tariffs look like, what the future and under a Trump administration can look like. And actually, you've done great reporting across the entire team that they have interesting relations across Asia. More broadly somewhere they have to invest more to earn the right to sell their products in China, where they have to earn the right to continue to build so much.
The absolutely in a real study of contrast, today, Bloomberg also had a report out that Indonesia is really pushing back on lifting its iPhone sixteen sales ban, really demanding more investment from Apple, saying, hey, you have invested so much in manufacturing in Vietnam, which is a smaller market for you in terms of iPhone sales, why not invest more in Indonesia, which is the largest Southeast Southeast Asian economy. So the two stories today stood as a real contrast for me, this push from Indonesian leaders versus just this report out of China that really highlighted how vulnerable Apple's business is in the region.
Dana we love the context Dane woman for all things Apple. Let's talk about the other juggernaut that is in video. A big exposure to China too, of course in terms of selling into that market. The CEO, Jensen Wang, was just in Hong Kong over the weekend, where he received an honorary doctorate in engineering from the Hong Kong University of Science and Technology. He emphasized in Vidia's ties to the region and weighed in on the potential impact of the incoming US administration.
Just take a listen.
I don't know what's going to happen with the new administration, but whatever happens, we'll balance multaneously compliance with laws and policies, continue to advance our technology and support and serve customers all over the world.
Will continue to do that, and we'll be able to do that.
Just fine.
Let's keep this conversation going from an investor perspective. Scott Ladin, a CEI of Horizon Investments. Does it give you pause as you try to understand what on earth US China relations look like next year and how it impacts your investments in tech?
Yeah, look, it has to.
I mean you have to take account of what this administration says they're going to do to China, especially on the tech front, and and frankly, what China's retaliation might look like. You know, we think actually the US is probably a little bit of a stronger position than they were in twenty eighteen, the last time these two powers really confronted, because China is frankly in the throes of a balance yout recession right now, so they probably don't have quite as much maneuverability on the on the stimulus side. But at the end of the day, you know, like taking account of how these two are going to interact amongst each other, kind have a lot to do with where we put our money in.
Okay, So would you ever, even at these pretty beaten up levels, be thinking about the Chinese technology giant still being an area to be a creative in the future.
Look for once for me twice on the Chinese stimulus stuff, it's not you know, you can't you can't predict what the what the Chinese administration or the Chinese Communist Party is going to do with respect to fiscal stimulus, which is really what the doctor ordered for that economy. And without that fiscal stimulus, it's really tough to get out of these balance sheet recessions where demand is just lacking. And so you know, if we do get signs, not signs, we get announcements that the China is going to engage in large scale fiscal stimulus, then yes, you have to get on board the Chinese tech stocks because you know they because then the consumer can come back alive again in China and we can really get get going. But without that, it's you just you can't predict policy in China. So you know, we just have to take a wait and see approach.
What about US names that have significant exposure to China and perhaps haven't managed to show that they've got such strong demand globally that it doesn't matter.
You know, it's gonna hurt them, you know, any but this is not you know, there's not new news. I mean, everybody knows with the Trump win that China's is going to be sort of enemy list number one. And so you know that these these companies have been planning for a while the potentiality of a Trump win.
They're going to have answers to it.
But you know, just just because you know, this is you know, like I said earlier, this is not new news, well, let's.
Think about what's not new news when it comes to a player like in video. Currently, in Video is one the worst points contributor to the NASDAC. Today we're falling significantly another three percent, which is a lot of market cap erosion for Is this as big as this?
Is that more.
About just profit taking? Is that about exposure China? Is it about exposure to too few clients like Microsoft, like Amazon and like Alphabet.
Yeah, look, it's probably a little bit of all those things, Caroline. It's it's you know, when you when you have one of your largest clients, you know, a company like Amazon coming out and saying, look, we might start competing with you, we might get in this game. Even though they've they've been in the game for a while, but now they're really ramping up efforts. You know, this is obviously a very lucrative space. You know, margins of seventy five eighty percent on businesses like this, So you know, it makes a lot of sense for it for other large tech companies to come in, to come in and try to challenge in Video's place in the market. These things will take some time, but but you know, those things will have to weigh on the on the stock price at some point.
So what do you do, Scott? Do you keep the exposure you have to? It feels a fool Zerran to have a bet. Again, it's big tech in some way.
Oh but let me be clear, I'm not I'm not advocating it anyway to bet against they bet against big tech. I mean, you know, we are we are in the in the mid to late nineties sort of cycle. AI is him as my kids would say, you know that, you know so this this is this is definitely a training guy to get on, but the train like that they have to get on in a broadening sense. You know, this is not just in VideA anymore. This is not the twenty twenty three AI trade. Just so you know, the broadening out of this team into other users, like how are companies going to use.
AI in the future, you know what?
Other what other you know, suppliers are going to come online, like like possibly Amazon in the chip space. So you know, playing that broadening out theme inside of AI is rankly We're spending quite a lot of time trying to figure that out here at Horizon, and it's something that I think a lot of investors are going to have to, but it is you know, you know, you do not want to be short tech. You do not want to be short at these this AI theme this time. To get on board, you have to understand how to play it for twenty twenty five, not for twenty twenty three.
I know you don't want to share the secret source. But as you're.
Doing that work, where have been the rich pickings so far?
We've heard often.
It's about the energy play, or it's about the applications within healthcare, But where have you found some of the outsized potential here?
You're you're picking on a couple of them. Look at mean, you know, at some point you've got to get down to the users. So you know, if you know, if you.
Think about how how the tech trade played out in the middle late nineties, you know, first there's the people that made the tech and made things possible. But really, you know, the main gains where to we had by people that use the technology, that use the internet, that use PCs in order to enhance productivity in their businesses. So you know that, you know, getting onto that, getting onto that type of play is we're spending quite a lot of time trying to figure out, like you know what.
You know you mentioned healthcare, which.
Biotech companies are going to figure this out in order to do advanced drug development? You know which which major farmers are going to figure this out for the same type type of reason. You know what kind of industrial companies are going to figure out logistics improvements based on some AI logical that they're building in their processes. And so those types of questions are the things we're trying to answer right now. You know, I do think we're second or thirty any of this stuff. It's probably a little early to get really on board with the users, but it is.
You know, you have to start doing the work right now.
Keep going on when you've done the work, and as you continue down at Scott Lander, his CIO of Horizon Investments, we really appreciate your time today. Meanwhile, coming up, we've got so much more on some of the stocks that have outperformed. Tesla for example, absolutely mean like stock Search, is it needing Wall Street feeling a bit wary at these levels.
We'll bring you the details from the latest UBS.
Note, as we're up another four percent over the last five days, let's just focus in in one of well key driver in the market, today is Tesla.
We want to look at it over the last month.
Shares as you see thirty one percent in the last month because well, of course, all surrounding the new administration that's likely to come in twenty twenty five. BBS analysts are cautioning that this post election surge is more to do with marketing xuberants and actual improvements in the fundamentals of the business.
Who knows Cretridel.
Has more And we've been trying to understand crucially whether this relationship personal one really between Elon Musk and Trump and the future administration will bear dividends for the business of Tesla, And you've been trying to measure it up, so has UBS.
Yeah.
I think UBS's report is very interesting today because they will sort of grant this idea that narrative wise, it makes a lot of sense that you would see a run up in the stock given how close Elon Musk has placed himself to Donald Trump. But they really sort of pick apart some of the reasons you know, commonly cited for this run up in the last few weeks. You know, you take a look at taking away ev tax credits in the US, for example, maybe Tesla is able to handle that better than some of its competitors that aren't making money on EV's but it's still not a positive for EV demand as a whole, and so UBS is a bit bearish on that front. And when you look at autonomous vehicle policy as well, you don't have an actual robotaxi at Tesla, whereas you know, Weimo is out with a robotaxi now, and you know that was that company was just valued at about forty five billions. So does it really make sense to put, you know, potentially one hundreds of billions of dollars on a Tesla autonomous vehicle valuation given its it's sort of closest comp Weimo is valued it much less than that.
The problem is.
The price target for the next twelve months on average from the analyst that rate it is well below where we're currently trading two and forty four, whereas the last price is currently three hundred and fifty four. We've seen relative strength indexes of Tesla just show that we are over bought territory, and yet we don't seem to be able to actually against the stock.
Yeah.
I think that's another point that UBS makes interestingly today. Is just that we've seen this before. We've seen that this is sort of an ultimate momentum stock that when it rises, it really rises.
When it falls, it really falls.
And I guess that's sort of befitting of Musk, right, he doesn't do anything halfway. But you really see in terms of you know, equities that are are commonly you know, traded with with options that you know really sort of lead to these outsized moves. I think Tesla is you know, sort of exhibit A in terms of stocks that you know, because of the options activity, you tend to see you know, sustained and really dramatic moves in the stock one where or the other when you have a a sort of reason for the stock to you know, narrative wise, you know, go in one direction or the next.
We'll see whether the meme trading can continue. We're currently up on the day at least. Created Al always great to check in with you.
Meanwhile, let's take.
A look at Rocket Lab shares absolutely surging as well after the satellite company said it successfully launched IS fifty sixth electron missile LUMEGS. Bruce Einhorn joins US. Now we're up three percent there's other narratives around the business today in terms of the chip sacked, but focus on this launch. We had one out of New Zealand very swiftly after one out of the United States.
Yes, so there are two launches. The launch in the United States is for a customer that the rocket Lab has not yet disclosed. In the past, rocket Lab has done launches from Virginia for US government customers. The launch in New Zealand was for French startup. This was part of a multiple launch contract that rocket Lab.
Has with them.
So altogether this makes fourteen launches that rocket Lab has had this year, which beats their record which was ten last year.
Let's put this in context.
Impressive for rocket Lab, but remember that SpaceX has had more than one hundred launches this year.
They are very much still and also run at the moment, but they're clearly garnering some momentum here. What's interesting is they're also getting money from the US government when it comes to chips. Where else in the manufacturing area are they and why are they getting such money from the Commerce Department.
So this is the final signing of a contract from the Department of Commerce related to the Chips Act. Twenty three point nine million dollars. The company had announced a preliminary deal for this before, so this is not a surprise.
People knew this was coming.
Rocket Lab has a subsidiary in New Mexico that makes solar cells. It's one of the only companies I believe they are only two in the United States that make these components. And so rocket Lab has now gotten funding from Commerce Department to promote that to build more of those. So just giving another lift to this stock. Interesting what you were talking about with craigirl about optimism about post election. Rocket Lab is one company among several space companies also benefiting from this bullishness after Trump's reelection that the new administration will have policies that will be favorable to the sector.
Almost twelve billion dollars market capitalization not quite up to the two hundred and fifty billion dollar market evaluation we understand for the privately held SpaceX At the moment, Bruce Einhorn will need to get the context.
The French government.
Suffering to buy the advanced computing assets.
From ATOS for as much as six hundred and fifty.
Three million dollars after an earlier offer from the state expired. Now the offer includes the company's AI business as well as its supercomputers and Merg's Benoir Badillo is here with more And what is better about this dale or is it just different because this is all about trying to bail out what is a company that's under a lot of duress from a debt perspective.
Exactly.
Yeah, it's important for Athos at this stage to divest it has these activities. The creditors who are taking over the company will win liquidity out of it. And most importantly, the French state has wanted to ensure that these strategic assets remain within French control and are sort of safe. These are important assets because the supercomputers we're talking about are used to do the dissimulations of nuclear activities for example, that are very key to friends and the French government.
So this deal is sort of narrower.
It's just on the supercomputers part of Athos, which called build Essay, and this leaves on the sides other assets that are in cyber security or what's called mission critical systems. So these are said are going to be sort of up for auctions and other French companies again are going to make bids for these activities.
So that's the kicker here.
These all want to remain in local hands in some way.
Some deals have worked world.
Grade unit we sold to a French engineering company, but others have unraveled, like the one with Talas. Is it just trying to find the right price point here.
Yes, there's a bit of that. The creditors want a good price point for it. That the French defense companies bidding for these assets will certainly want to have a good price as well. We know that Talis, an important French defense company, is interested by what's called mission critical assets here. They said in the past they could be interested, they have not made a bid yet. It was probably complicated for these companies to do a deal with the French states. So now the state has done the deal in the supercomputers, and other deals could be done. But you're right, what's at stake here is really used as strategic assets and the sovereignty of French technology that's critical for the civilian industry and also for a lot of military use. So while this company has been unraveling, it's really the stake of these really sovereign assets that's at steak now.
Meanwhile, it's bonds trading at sense on the Euro. Significant pressure there still Benman Bartolo on that key French asset.
We thank you very much. Meanwhile, time for talking tech now.
A first up online verification company, id dot me as close to tender offer that value the business at one point eight billion dollars, according to a source, REMIT Capital, a new investor in the company, led the transaction with existing investors Viking Global Investors and Capital G anticipating plus insta three sixty. It's a Chinese rival to GoPro, with backers including IDG. Capital is considering an IPO in Hong Kong after plans for a listing in mainland China stalled, according to sources who say the company could seek evaluation of at least two point one million dollars in a share sale. And Sony is in the early stages of developing a portable console there all play its PlayStation five games on the move. According to sources who paid say that the product is meant to expand Sony's reach and go head to head a Nintendo in the portable gaming market. Welcome back to Bloemberg Technology. I'm Caroline Hyde in New York. Yet more news around companies buying adding to the balance sheet MicroStrategy one of them. Let's get to it with Kristin Smith, SEO of the Blockchain Association, who can really discuss the future more broadly of how we're going to be thinking about where we go in terms of overseeing of bitcoin and crypto more generally, how we're going to see more laws made.
Of course, we've had.
The news that the SEC share Gary Gensler, is announced that he's going to be stepping down from his seat come January. So, Kristian, were you surprised by the news that he's front running in.
No, I wasn't surprised by the news. It's very common when there is a change of power for the chair of the SEC to step down at the end of the Congress and the end of the presidential term before the inauguration, and so, you know, we're certainly very excited to see him leave. It has been a really difficult couple of years for the industry. We felt like we've been boxed in the corner with his regulation by enforcement approach. But right now we're really focused on trying to figure out, you know, how can we move forward as an industry how can we reset our relationship with government. And we're very excited to get new people into these key positions and work with the newly elected Congress when they come to power next year, because I think we have a real opportunity to get a regulatory frameworkting place that will that will be lasting and appropriate for the industry for decades to come.
Okay, can you talk to us about the names, for example, the sec acclony, pondering, folly, chump for example.
These will the names that you think won't be regulation bond form.
Yeah, and I think that there are a couple of great names that have been floating around for the chair of the SEC. I think from the standpoint of the Blockchain Association and the industry, what we want to see is somebody in there who has experience and deep understanding of crypto. I think there are going to be many challenges of the SEC chair faces, but figuring out the right regulatory environment for digital assets is going to be one of those things. And so we don't care who it is as long as it is somebody who has a deep understanding and who's willing to have an open dialogue with the industry.
There's been a discussion about having the first of a crypto post in the White House. Is that necessary at this moment when you have a relatively pro Congress, more procrypto.
Than we've ever seen before.
Add indeed, a new SEC check, I think it.
Would certainly be a welcome position. I mean, make no mistake. What we needed was a strong Treasury Secretary pick, and I think we got that with Scott Bessett. We also need strong choices for the SEC and the CFTC because without those three positions, a CRYPTOSR isn't going to be able to get much done. But if you look at the many different issues, and this is something that we touched on our letter to President Trump on last week, they cross many different agencies.
Right.
We need to deal with the debanking issues with the prudential bank regulators. We need to deal with the market regulatory issues with the SEC and the CFTC. We need Congress to step in and pass a new law. And I think having a CRYPTOSAR position at the White House would help facilitate those conversations and make sure that we're getting.
All the pieces done.
Because there are a lot of different different parts that need to be addressed. They occur across many different agencies, and so yes, we would welcome someone in that role, but not at the expense of getting somebody strong in at the SEC and the CFTC.
Okay, So, if it's not a mutually exclusive thing, who would you want to see as a ZAW level? How deep within active duty do you want them to be or do you want them to be perhaps a step remove in terms of advisory.
Well, I think there are really two qualifications you want from that role. One is you want somebody who understands the crypto industry.
It is very nuanced.
There are a lot of different pieces, and you need somebody who can understand and navigate the people and the personalities of the industry. I also think, though, you need somebody that knows how to navigate government, because if you have someone who shows up from industry but doesn't understand the nuances in the history of their relationships, you know, it would be difficult. And so I think that's going to be a very tough position to find. But I think there are a lot of people in the industry that are willing to step up and step in and do that kind of role.
For people who aren't day to day working in crypto. Can you explain to them why they would want to see an SEC chair so deeply in the weeds of understanding crypto when the SEC also has to oversee the trillions in passive investment, the understanding of implications of AI on ETF investment, and ultimately when Crypto remains all about the same size as Nvidia's market cap.
Yeah, well, I.
Think that this is something.
You're going to be someone who can walk and choo gum at the same time, right. I think if you look at Crypto, yes, it's just approaching a three trillion dollar market cap, but this is still the early days. This is going to be the foundation of financial services, of our Internet, of so many things going forward that we really want to get the regulatory framework right now for when this is a ten to twenty thirty trillion dollar asset class. And so I think that it's really important that we get the rules right so that consumers feel protected, so that institutions feel comfort to come in, but also so that the developers, the builders of the underlying blockchains and the applications on top of the blockchains, they understand the rules of the roads. They can do it right here in the US I think this is going to be a big part of our economy in the future, and if we don't get the rules right now, we're going to miss out on that here in the United States.
Have you been asked, Kristin for bisar Ro pardon? Have you been off to told about Bizarro?
I've spoken to some people about it, not for me, but I've offered some ideas as to what kind of qualifications would be goad.
Kristin Smith, thank you for the transparency. It's great to have you on again. See the blockchain and Association. Meanwhile, let's talk about other government versus tech. Google and the US government really facing it off in federal court today as each side and delivering its closing arguments in the case, and the tech joan's a legend monopoly of online advertising.
Adam Epstein's here with us. He's COSEO of the Search.
Advertising Company and Marketplace been advising the DOJ and Trust team on the remedies in this case.
And this is sprawling. At the moment.
Everyone's front of mind for Alphabet and Google is the fact that they might have to sell off Chrome. Now many would say, okay, it's about dominance and search. Many people worry us about dominance and advertising, and that's something that Europe's been looking at too. Just tell us what role you've played for the US government.
Sure, so you know, I've been in search for twenty years. I went to the closing arguments back in May, the decision came out and August and I wrote a memo talking about how there could be behavioral remedies that could fix the search and the advertising search advertising markets. The DOJ saw the memos, asked me to speak with them a few times about what we're doing, and then you've seen in their proposed final judgment in order. Some of the ideas are in there, as well as some of the ideas around Chrome divestiture, Android divestiture. Some of that's around making sure that Google would comply with the behavioral remedies. And so this is a two hundred billion dollar market and this minimum opolate's been running for a while, so getting the remedy rate is difficult, and then making sure that there's compliance will be the next step.
Your business is in the world of placing advertising, but not having to depend just purely on a few key dominant forces in search. Right, would some of the things being discussed at the moment. Some of the remedies dramatic as they are, help your benefit and benefit your business.
Sure, you know, there's I think a lot of folks that would be able to invest in this. In this industry, it's been I think such an adelict. Microsoft called it a no fly zone for investment for about twenty years. So we've been working where we can around the edges to help browsers and large shopping apps create native search experiences, and we think that is the future. And obviously we have a little bit of a head start, but there will be a lot of entrance in this space, both from the advertising side and on the search results side, especially around AI next gen search agents.
That's really the future, and that's that's kind of the irony of the whole situation. Many feel Actually Google's never been under such competitive threat than they are now, particularly when it comes to us perhaps dotting Google searched one and instead using chat gipt.
You might also they be using AI overviews and a Gemini offering.
Just from your perspective setting off a chrome, can you see anyone in the market actually.
Buying that, apart from an open AI for example.
Sure, I think there's other folks that would be itento in buying Chrome. It's the largest browser in the world. I think with the DOJ's initial proposed to be really set off was the first shot of browser war three point zero. Okay, So I think you'll see other browsers, you know, the duc Duck goes the Firefox of the world, the Braves, those folks will be more to the front forefront. There'll be new browsers coming out, perhaps really built around gen Ai and the idea there is that you know, if we have a lot of entry points and we're still able to have some Google modernization, some Google results side by side, that's gonna be the best and most innovative experience for users and searchers.
It's not that it's an all or nothing.
Either you get Google and you've got to take Gemini, or you can use something else. It's a little bit more innovative or trying something different. The idea that we all go to the search engine result page of Google and basically get a one size fits all solution. That's I think what the real you know, detriment is to consumers and to users of the search monopoly.
We have Chrome in place, but the problem is.
It's very expensive for the infrastructure build around an offering such as search and Google Chrome as an access point to search. Would anyone ever be able to offer such a great product consumers without the huge deep pockets that a Google has.
Exactly so half the clicks that Google sells out to advertisers start on third party sites like Apple, like Samsung. The question is can they get access to Google's results into their ads and then curate their own experiences with perhaps instead of Gemini, a chat GPT search agent, or with other ads, or with other results, or ranking and changing how the rankings work. That's really what we're talking about is allowing for that innovation to take to take hold, not forcing force funneling every user to search result page of Google in order to take advantage of Google's assets. So the idea is, I think it's both. It's not an either or situation, and that would be the remedy that I think gets us into a more innovative space and also brings competition to the market, which is at the end of the day, what the goal is.
Well, we're going to be waiting for the final round of what exactly is going to be offered, and indeed, then an appeal process. But in the meantime, Adam, it's been great having here from a perspective of the ad marketplace. Is coca there, Adam Epstein. Meanwhile, coming up some major fundrais news for cybersecurity firm Halcion.
Company CEO John Miller joins us.
Next, this is a bloom technology.
In today's VC Spotlight.
We're talking about the explosive growth in ransomware, and we're looking at.
What a cybersecurity firm, Halcion is.
Doing to stop those attacks and how it plans to invest his newest round of funding. Here with more is Halsey and CEO John Miller, who's just announced announcing one hundred million dollar raise.
It's your Series C.
Congratulations John, and I want to understand when you yourself now have a one billion dollar valuation, put that into context of how much each year cut bad actors are making from ransomware.
Oh, it's a small, small fraction.
Right.
We've seen the growth of ransomware year over year explode in the last five years. You know, the losses that corporations are seen are on the scale of tens to hundreds of billions of dollars a year, Right, Now, the scary thing is we're the only actual, or at least the first any ransomware company to ever exist where we took ransomware as the mission of our company to try to figure out how to mitigate as much risk for our customers as possible.
Okay, so that's fascinating for our viewers to try and understand. How you block suddenly your corporate being overtaken and everything demanding that you give them some crypto payment immediately. What is it that your technology is different?
So what we're all about is breaking that leverage that they get to actually incent someone to pay them, right. So it normally goes down into kind of two forms of extortion. One is they'll come in and encrypt everyone's data, effectively breaking the computers, right, and then they'll demand extortion to get the encryption keys back to bring all the data back. And then the double ex as it's called, is when they steal data from outside of the enterprise and then charge you to not release it. And so what helsy on what we do is we've figured out how they xfiltrate or steal that data, and we stop it when it starts to get stolen, and we when they go to encrypt the systems, we stop them, and if they successfully encrypt something, we capture the encryption keys and we have the ability to just decrypt everything.
Anyway you can explain the underlying of what it is you're doing.
Yeah, I mean it's all super technical, right. The best way to think of it as like a new type of focused anti virus. Instead of anti virus being wide against all types of kind of malware and spyware and adwear, we're just focused on ransomware. And so because of that, we every day we follow the different groups, We take apart their tools, we take apart their samples. We're just completely focused on this threat, and it's giving us increased efficacy over everybody else that's trying to do like general security for everything. It was our theory that ransomware had becomes such a big problem that by actually focusing on it alone would give you higher affocacy in the ability to mitigate more risk than the more generalized solutions that exists.
But at the moment we are We had Palo Alto Network see on last week, for example, and there's a shift between towards what he says is platformization. People wanting not just loads and loads of different vendors, but wanting a one stop shop to protect them.
Would you end up folding in.
Your offerings to other cyber players out there? What is your end goal here when you've now raised a good chunk of change from some key partners.
So we integrate with all of those players, the Palo Alto's, the Cisco's, the Dells. Really we are kind of our own platform, right, so we're building ourselves to not just have a feature that gets integrated into something bigger, but a platform specifically around mitigating the risk of these ransomware threats. Right, as these attackers continue to get more money and be more successful, it just gives them better access, they get better tools, there's more of them. So we're starting to, I mean, and I think it's obvious we're starting to lose the war against these attackers. And by coming in, we're going to use this money to just try to bring as much value as we can to our customers about stopping these ransomware attacks.
John Miller und a million dollar Seriously, we thank you from Houseion. Amazon getting ready to go toe to toe with Nvidia in the AI hardware space, so that won't happen anytime soon. The car coomputing giant is hoping to reduce its reliance on the chip maker Remags.
Matt Day is here for more.
The toe to toe quote comes from a very key executives within Amazon who's trying to take on in video in the training and inference space.
Tell us about it, that's right.
That was from James Hamilton, the godfather of Amazon Web Services hardware strategy.
About a decade ago.
He suggested to Jeff Bezos that they get started making chips, and we're seeing some of the fruits of that now. You know, they weren't necessarily planning on the AI boom to unfold as it is, but you know, it just so happens. They're on their third generation of AI chip and they think they've got a part as they'd call it, that can compete within video.
Why is the generation so important and why therefore they're going all out and handing four billion dollars to Anthropic again to be able to get them to use these chips.
Ever Moore, Yeah, so the third generation is kind of the prove it point in chips. You know, your first is an experiment, your second starts to catch on in the third. If you did it right, It's probably going to be the one that gets you the volume and the success that or else you go a different direction. This is definitely helps explain why Amazon is doing things like spending all that money on anthropic as you said, investing in them and investing in other partners who will help them use their chips, help them improve Amazon's home built chips and build a better mass trap to compete more effectively within video.
In videos down a lot today, three percent. It's a big move in terms of market cap because it's of course got a massive market cap. But at what point would we see less dependence on an Invidia from an Amazon. What is they end goal here that they no longer have to buy them at all, or is it more that they just supplement and aren't quite so dependent.
I think it's definitely to supplement it. You know, Amazon's a pretty sober about this. They're not trying to remove all of the Invidia from their data centers, far from it, and that would be a miracle if they could pull that off. And I think the goal, if they were even optimistic, would be that they can create a credible rival to in video. They can put a lot of those in their own data centers, and then you know, for the customers of theirs who want to use in video that's still around, but that they've got a competitive offering as well.
And just remind us, I mean, Alphabet's been at this a long time. Microsoft and just getting in the space.
Yeah, Amazon's got company, or as you said, Google's been doing this for about a decade. Microsoft just now is rolling out its first chips. But it seems that everyone in the cloud has come to sort of the same realization that they need to build the hardware too, and they need to build the more sophisticated hardware, which are the chips.
Matt Day.
It is a great piece Today's Bloomberg Big Take, go read it, an excellent deep dive.
Meanwhile, we've got.
Plenty more news on Amazon because that came out on Friday that they're really trying to help their clients.
Understand quantum computing.
It's the next iteration of artificial intelligence and machine learning, and boy is it helping some quantum computing stocks.
Look at this. On the day, we're currently.
Seeing Rerighetti up seventy one percent. We're up twenty eight percent on quantum computing as They're saying, Amazon's offering advisory help as well as, of course the future of where hardware goes when it comes to using quantum computing for its clients. Now that does it for this edition of Bloomberg Technology. You do not want to forget.
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